The Massachusetts Gaming Commission is considering a new regulation that would prohibit operators from promoting sports betting via non-gaming transactions.
The new rule was inspired by an Ohio regulation that aims to protect those under 21 and other at-risk individuals from being targeted with sportsbook promotions. Ohio initially proposed this rule after discovering that Fanatics was offering betting bonuses for its sportsbook to all customers who purchased merchandise from the company’s online retail business.
Massachusetts considers new ad rules inspired by Ohio & Fanatics Sportsbook
A new Massachusetts sportsbook rule could soon be in the works, thanks to recent efforts in fellow sports betting states. The Ohio Casino Control Commission first flagged the Fanatics incident in May of 2023. Gambling industry observers tipped off Ohio, noting that the company was offering a Fanatics Sportsbook bonus bet to anyone completing a merchandise transaction.
The offer awarded Fanatics retail customers a bonus bet equal to the amount of their merchandise transaction. For example, if a customer purchased a $40 jersey, they’d receive a $40 bonus bet to use at Fanatics Sportsbook.
The company removed the sports betting promotion in Ohio shortly after it was first reported.
Fanatics launched its sportsbook in Massachusetts last May, around the time that the Ohio controversy first surfaced. At the time, a spokesperson from Fanatics Sportsbook told PlayMA that it would not offer the promotion in the Commonwealth.
New Ohio rule working its way through the regulatory process
The promotion seemingly violated state gambling laws prohibiting sports betting operators from marketing to underage residents (a rule also present in Massachusetts). However, Ohio regulators developed the new rule to ban such promotions explicitly.
The Ohio regulation states that “sports gaming proprietors must not offer a promotion or bonus in connection with or as a result of a non-gaming, consumer transaction.” Such promotions or bonuses are permitted if the targeted individual has been verified to be 21 or older and not participating in Ohio’s Voluntary Exclusion Program.
The rule change proposal in Ohio is still advancing through the state’s regulatory process. It’s likely to be implemented by the end of the year.
MA sports betting operators feel rule is unnecessary
The MGC began considering the idea of new Massachusetts sportsbook advertising regulations back in April. After hearing of Ohio’s efforts, Massachusetts requested guidance on the matter from MGC counsel.
On July 11, the MGC discussed adding a rule similar to Ohio’s to the promotional rules for sportsbooks operating in Massachusetts. The commission received feedback from Fanatics, FanDuel, and DraftKings regarding the proposed regulation. Overall, the operators felt the new rule was unnecessary, given the already-present marketing and age-check regulations in Massachusetts.
According to the MGC, the operators felt a rule similar to Ohio’s would be difficult to implement fully and “will result in them being forced to market through other channels that will actually lead to an increase in the number of underage or vulnerable viewers.”
Massachusetts commissioners favor more stringent advertising regulation
MGC counsel presented commissioners with three potential rules from which to choose. The commissioners favored the most stringent (and most akin to Ohio’s rule) of the three proposed regulations. The rule would require Massachusetts operators to verify a targeted individual as:
“. . . being twenty-one years of age or older and not participating in the Massachusetts Voluntary Self Exclusion (program).”
Commissioner Eileen O’Brien said the new rule feeds into her ongoing general concerns about branding and marketing reaching underage individuals in the state:
“Speaking from personal experience (of) buying something on Fanatics and getting your receipt that says, ‘Do you want to do X’ — I have concerns with that going out there just randomly. This goes back to some of the branding and crossover that I have concerns about. I am very interested in looking at language, in this regard, particularly with the affirmative obligation of the operator to establish ‘not VSE’ and ‘over 21.’ ”
MGC requests more info, plans for further discussion on sportsbook advertising
Ultimately, the commissioners decided that they would like to further discuss implementing the promotional regulation. Commissioners asked the MGC counsel to contact Ohio regulators for more information about how the rule would work in practice. Additionally, they requested that operators provide concrete examples of any difficulties they would have if the rule was approved in Massachusetts.
Interim MGC chair Jordan Maynard said the commissioners have to weigh what’s in the best interest of the Commonwealth:
“Yeah, we can do more here. I see an opportunity. It looks like Ohio has paved the path to show where regulators can do more. That said, we also have to balance some of the concerns of the operators. So I’m happy to engage in further conversation (on) where we take this potential reg and potential solve.”
In the meantime, the MGC has decided to ramp up efforts by fining Fanatics $15,000 for erroneously accepting a bet on an in-state college basketball team.